Physician jailed on contempt after fraud conviction

Posted: Sunday, April 09, 2000

ANCHORAGE (AP) -- A podiatrist convicted on 58 counts of billing and mail fraud was hauled out of a federal courtroom to jail Friday, charged with contempt.

U.S. District Judge James Singleton jailed Dr. Steven Kaniadakis for failing to produce billing records subpoenaed by prosecutor Dan Cooper for use at the doctor's sentencing, originally scheduled for Friday. The sentencing has been delayed three weeks.

Kaniadakis said he didn't get the subpoena until recently, and the records were too massive to gather and deliver quickly.

Singleton said he didn't believe Kaniadakis. The judge ordered the doctor to remain in jail until his rescheduled sentencing on April 28, but said any time he serves after producing the required records can be counted against his fraud sentence.

The doctor faces a probable minimum of five years in prison, the judge noted.

Kaniadakis was charged with illegal billing from 1994 to 1997, despite warnings from several billing clerks that his practices were improper. At his trial, the doctor maintained that he may have misunderstood some of the rules but never intended to cheat anyone.

A federal jury didn't believe him and convicted him of 16 counts of fraud, including charging insurance companies a $1,550 fee for use of an ''ambulatory surgical facility,'' which he did not have, and double billing patients and insurance companies for medical procedures.

Jurors also found him guilty of 42 counts of mail fraud for using the U.S. Postal Service to send the illegal bills.

After the trial, prosecutor Cooper subpoenaed records for patients treated after 1997. Although not part of his convictions, proof of continued illegal practices can be used to convince a judge to hand down a longer sentence, Cooper said.